SAS ends A340 operations

EU court annuls Italian state aid approval

Ryanair (FR, Dublin International) has welcomed a ruling at the General Court, Europe’s second-highest court, on state aid favouring Italian airlines during the Covid-19 pandemic. The court backed the low-cost carrier’s challenge and annulled the European Commission-approved aid.

In October 2020, the EU competition authority allowed Italy to give EUR130 million euros (USD140 million) in subsidies to airlines holding an Italian operating licence. As ch-aviation reported at the time, while the country’s then-flag carrier Alitalia had received EUR199.45 million (USD213.6 million) in Brussels-backed state support in September 2020, three other local carriers, Air Dolomiti, Blue Panorama Airlines, and Neos Air, appealed to the Italian government “to act as quickly as possible” to release the newly-approved EUR130 million.

However, in its May 24 ruling the Luxembourg-based court said that the authority had “failed to provide a statement of reasons for its finding that the measure at issue was not contrary to EU law provisions other than those governing state aid.”

The court explained that “according to settled case-law, a decision not...

Norwegian eyes “alternative” to Copenhagen due to delays

Norwegian (Oslo Gardermoen) is considering shifting its flight operations away from Copenhagen Kastrup Airport to a nearby alternative as staff shortages continue to cause delays at the Danish hub.

A dispute between air traffic controllers, represented by their union, and the state-owned air traffic service Naviair, their employer, has exacerbated a growing shortage of the specialists, resulting in delays for hundreds of thousands of passengers in recent weeks.

The low-cost carrier has reportedly expressed its frustration over the matter to the Danish government and has also discussed the matter with Nordic rival SAS Scandinavian Airlines (SK, Copenhagen Kastrup), according to the news agency Ritzau.

“We have to look at alternative airports that are close to Copenhagen Airport,” Norwegian CEO Geir Karlsen told the newswire. “I don’t know whether that will be possible at such short notice, but this conflict is cause for increasing concern and that concern will grow as capacity increases during the summer.”

According to the ch-aviation capacities module, Norwegian Air Sweden AOC (D8, Stockholm...

SAS obtains US court nod to raise new equity capital

SAS Scandinavian Airlines (SK, Copenhagen Kastrup) has secured the approval of the US Bankruptcy Court for the Southern District of New York for its attempt to secure fresh capital from investors through the use of equity solicitation procedures, it announced in a stock exchange filing.

Through these procedures, the carrier, which entered voluntary bankruptcy protection in the United States in July 2022, “will run a competitive and broad solicitation process to secure the best available terms and conditions for new equity capital,” it said.

The embattled carrier revealed in May 2022 that it needed SEK9.5 billion kronor (USD920 million) in new capital, although in early April 2023 it said that the final sum raised could differ from this amount, depending on the bidding process and whether the airline could generate additional liquidity.

In the latest filing, dated May 15, it said that the deadline for potential investors to present final bids will take place in approximately 13 weeks, with the overall aim of completing its court-supervised process “in the latter part...

EU court annuls Lufthansa, SAS state aid approval

The European Union's General Court has annulled the European Commission's 2020 decisions authorising EUR6 billion euro (USD6.6 billion) in state aid to Lufthansa (LH, Frankfurt International) and SEK11 billion Swedish kroner (USD1.1 billion) to SAS Scandinavian Airlines (SK, Copenhagen Kastrup) by their respective governments.

The Court found that both decisions were taken with errors insofar as they were not compliant with COVID-specific state aid rules, even though they were substantially laxer than the normal policy of the European Union.

Regarding Lufthansa, the Court found that the Commission did not assess whether the airline could raise at least part of the requested state aid on the market, for example, by mortgaging its unencumbered aircraft. The Temporary Framework - the EU's COVID-era state aid rules - required that alternative means be considered, even if they would not be sufficient for the entire amount. The Court also established that the state aid did not include the mandatory step-up mechanism incentivising a quick repayment of the aid.

The judges further said the Commission committed "a...